Updated 3:35 pm, Tuesday, September 24, 2013

Nearly 400 cities, towns and villages can apply for assistance from a new state panel convened to address a wave of municipal fiscal stress, officials said Monday.

The Fiscal Restructuring Board will offer each cash-strapped locality a blueprint for recovery, and up to $5 million in state loans or grants if municipal leaders agree to implement it. Years of population loss and the erosion of traditional industrial bases has left many upstate cities struggling, and a spike in required pension costs prompted by the 2008 stock market crash has pushed many to the brink.

"We know local governments have issues ... we expect that they'll make use of the board," said Budget Director Bob Megna at the board's initial meeting at the Capitol.

Gov. Andrew Cuomo pushed for the creation of the panel earlier this year after municipal officials became more vocal about their challenges. It includes representatives from the Legislature, as well as Comptroller Tom DiNapoli and Attorney General Eric Schneiderman, and was handed $80 million to fulfill its mission.

Any municipality may apply for help, but the 389 automatically eligible communities were selected by a measure of their relative property tax rates and reserve funds. They include the state's biggest cities, as well as large Capital Region communities such as Albany, Schenectady, Troy, Colonie, Rensselaer, Cohoes and East Greenbush.

It's unclear exactly which or how many municipalities will apply for the panel's assistance. DiNapoli's office has developed a separate fiscal stress monitoring system and designated roughly two dozen municipalities as stressed. None have taken his office up on its offer of more assistance. More municipalities will be named later this week.

"The challenge with this board is, are the financial incentives enough of an inducement to want to come through this?" DiNapoli said of the restructuring process.